Intellectual Property Rights in Living Matter: An Overview for Bacteria, Plants & Animals Drew L. Kershen Earl Sneed Centennial Professor of Law University of Oklahoma Copyright 2004, Drew L. Kershen, all rights reserved

Background General Intellectual property rights in living matter Teaching agricultural biotechnology since 1995 Expanded into three hour course in 2000 Three 1-hour components Intellectual property rights in living matter Comparative regulations – U.S. and E.U. International Conventions and Treaties Handouts – Basic explanation and science experiment OkJoLT Founded in 2002 – Julie Short; Ruth Okediji 2003 Michelle Grasso; Drew Kershen Spring 2004 – Project on Intellectual Property in Living Matter– Five students; five countries JoLynn Jeter – US Jason Naimi – Canada Katrina McClatchy – EU Robyn Ott – India Steven Ruby – Int’l Conv. 3 e-briefs each– accurate, concise summaries relating to the project topic Hopefully five more countries next fall (e.g Korea, Egypt, Mexico, Brazil, Australia, New Zealand, South Africa) Premiere URL for basic info – APS www.okjolt.org

United States Novelty Distinctiveness Non-Obviousness Plant Patent Act of 1930 Asexually reproduced plants – cuttings, grafting – single plant Requirements Novelty Distinctiveness Non-Obviousness Description as complete as reasonably possible Subpart of General Patent Law – USPTO Horticultural industry– flowers, fruits Plant Variety Protection Act of 1970, amend. 1994 Sexually reproduced plants by pollination, seeds – the variety Requirements New Distinct Uniform Stable Seed Deposit Plant Variety Certificate – sub-patent IPR -- USDA Exemptions from infringement Public Interest Exemption Research Exemption Farmer’s Exemption

United States Patent Act of 1952 – the general utility patent law Scope: useful process, machine, manufacture, composition of matter Requirements New Useful Non-Obvious Description Written description (reduced to practice) Enablement Biological deposit Funk Brothers Seed Company v. Kalo Inoculant Company (1948) – invention v. discovery Diamond v. Chakrabarty (1980) – scope of patents – man-made, genetically engineered bacteria for breaking down crude oil J.E.M. Ag. Supply, Inv. v. Pioneer Hi-Bred Int’l, Inc. (2001) – inbred & hybrid seed corn, non-transgenic Scope of patent Relationship to other IPR laws Dual protection

European Union UPOV ‘61, ’78, ’91 European Patent Convention (1977) 1961 European Convention Requirements: New Distinct Stable Uniform Biological deposit 1991 UPOV Strengthen breeders’ rights Weakened exemptions to breeders’ rights, particularly farmer’s exemption Removed prohibition on dual protection U.S. PVPA patterned after UPOV, including 1994 amendments Plant variety certificates European Patent Convention (1977) Scope: Not patentable Discoveries, scientific theories, mathematical method Art. 53(b) – “plant or animal varieties or essentially biological processes” but does not apply to microbiological processes and products thereof “Ordre publique” or morality Requirements New Inventive Step Industrial Application Description

European Union Novartis/Transgenic Plant (2000) Art. 53(b) – plant variety compared to genes and plant cells and plants generally Invention embraces plant varieties but not targeted to plant varieties Interrelationship between UPOV and EPC – no dual coverage Art. 53(b) interpreted to establish demarcation to prevent dual coverage Patent granted to Novartis for anti-pathogenic transgenic plants and processes for producing the transgenic plants Harvard/Oncomouse (2003) Claim for process of introducing oncogene sequence Claim for the transgenic animal (mammal - rodents) itself Art. 53(b) – exclusion for animal variety Technical Board of Appeal (1990) Art. 53(b) language does not include animals in general, only animal varieties Harvard application – for animal variety? – rodents Opposition Division (2003) EPC Rule 23c(b) – patentable if technical feasibility not confined to particular plant or animal variety Technical Board 1990 legal rulings Compatible with Novartis (2000) Harvard/Oncomouse patent upheld for process patent and on transgenic animal EPO upheld Harvard/Oncomouse patent but limited it to mice (July 2004) – not yet published

Canada Adapted from U.S. Patent Act of 1952 UPOV ver. 1978 Plant Breeder’s Rights Act of 1990 UPOV ver. 1978 Dual protection prohibited Patent Commissioner Manual of Patent Practice 1990 “multi-cellular differentiated organisms (plants, seeds, and animals)” are not considered within scope of patent act Harvard/Oncomouse Patent Office (1995) Process claims for creation of transgenic embryo allowed Product claims for the mammal (rodent) disallowed Supreme Court Canada (2002) Scope: does not include higher life forms – not a composition of matter or manufacture Canadian parliament must address issue Unexpressed concern about humans Sixteen jurisdictions grant; two have analogous case granting; only Canada has denied a patent for Harvard oncomouse.

Canada Schmeiser v. Monsanto Patented transgenic canola Infringement dispute Saved seed known or should have known for 1998 crop – not an innocent infringer Federal Court Trial (2001) and Federal Court Appeal (2002) – ruled on all points for Monsanto, except amount of damages Monsanto claims genes and cells genetically modified for herbicide tolerance Kershen, Of Straying Crops and Patent Rights, 43 Washburn L. J. 575-610 (2004) Siebrasse, The Innocent Bystander Problem in the Patenting of Higher Life Forms, 49 McGill L. J. 349-392 (2004) Supreme Court Canada – 2004 SCC 34 (2004) Patent Commissioner granted Monsanto patents; different burden of proof Scope – higher life forms Breadth of claims – if genes and cells, effectively plants – analogy to product with incorporated patented part Disputes about how to interpret infringement in self-reproducing patented plants or animals Election of remedies – profits or royalties – Monsanto lost on damages Siebrasse, A Remedial Benefit-Based Approach to the Innocent User Problem in the Patenting of Higher Life Forms, 20 Can. Intell. Prop. Rev. 79-134 (2003)

Infringement Actions As of October 10, 2004, 21 reported cases relating to utility patents and plants with 32 opinions Nineteen involve Monsanto Co. – 18 U.S.; 1 Canada (Schmeiser) Two involve Pioneer Hi-bred Int’l Inc. Oct. 2004 -- Monsanto Co. reported less than fifty lawsuits total -- Canada (2) and U.S. (45) – decisions, settlements, pending Allegation in Higginbotham v. Monsanto Co., an anti-trust lawsuit in Missouri that 475 lawsuits exist – no verification – Monsanto says has written approx. 500 letters to farmers Infringement actions PVPA infringement actions – Delta and Pine Land Co., Syngenta Plant Patent Act infringement actions Utility patents in non-biotechnology plants

Monsanto v. McFarling (2002) Facts: McFarling purchased Round-up Ready soybeans and signed Technology Use Agreement in 1997 Technology Use Agreement – payment of a license fee per bag – license authorizes crop for one season and prohibits saving seed for replanting or supplying seed to anyone for replanting McFarling did not dispute that he purposefully saved seed and replanted seed for the 1998 and 1999 crop years Legal Issue McFarling argued that prohibition on saved seed was a tying-arrangement prohibited by anti-trust laws Ruling – McFarling not tied to repurchase of RR soybeans – free to purchase any soybean seed – superior performance of RR soybeans resulting in desire to grow again is not tying arrangement

Monsanto v. McFarling (2002) Legal Issue McFarling argued that contractual prohibition on saving seed violated the doctrines of patent exhaustion and first sale Ruling – Scope of the patent grant allows patentee to license only use of the patented product – patentee by contractual license can condition the authorization – the Technology Use Agreement specifically prohibited saving seed and authorized growth for a single season only for commercial sale as commodity soybeans

Monsanto v Trantham (2001) Facts Trantham purchased cottonseed from cotton gin for planting in 1999 – sprayed the planted cotton with Roundup herbicide – repeated the same process in 2000 – 93% of samples RR cotton Trantham purchased soybeans from an authorized dealer but did not sign the Technology Agreement – 100% of samples RR soybeans Legal Issues Trantham argued that the Technology Agreement violated the Sherman Anti-trust laws prohibiting monopolization and unreasonable restraint of trade Ruling – the technology agreement as a license does not violate the anti-trust laws – patent holders are entitled to a monopoly – technology agreement by itself sets forth legal restrictions Ruling – clauses prohibiting seed saving and charging a technology fee are not unreasonable restraints of trade based on argument that Monsanto markets RR soybeans without the restriction and fee in Argentina – Argentina does not allow patents on plants -- Monsanto’s different marketing strategy responds to different market conditions